Most businesses understanding that independent contractor’s receive 1099’s and employee’s receive W-2s, but there are many misunderstanding about who actually qualifies as an independent contractor. The wrong classification can have serious legal ramifications, and could leave the employer vulnerable to liability for: failure to withhold and pay payroll taxes; failure to pay employee benefits; hourly wage violations; discrimination suits and more. The classification is also associated with your rights to intellectual property, involving elevated risks where in certain situations you are licensing the use of your trademark without conditions.